Trump is wrong on trade (1 Viewer)

[jpl458]

Who Pays the Cost of the Tariffs

Several studies have examined the cost of the Section 301 tariffs on the U.S. economy. For example, economists Mary Amiti, Stephen J. Redding, and David Weinstein showed that by the end of the first year that the tariffs were in place, U.S. real income declined by $1.4 billion per month. More recently, trade analysts Tori Smith and Tom Lee from the American Action Forum found that U.S. consumers largely bore the brunt of the tariffs, paying a total of $48 billion—with half of this figure paid by U.S. firms that rely on intermediate inputs from China. A recent report by the United States International Trade Commission agreed that the cost of the tariffs was passed through to U.S. importers. Back in 2019, President Biden also agreed, stating, “Trump doesn’t get the basics. He thinks his tariffs are paid for by China. Any beginning econ student at Iowa or Iowa State could tell you the American people are paying his tariffs.”

Now he wants a world trade war.

 

[The_Doc_Man]

I don't disagree that tariffs end up being paid by the consumers of the material under that tariff. However, the goal of a tariff is to redirect buying trends against the tariffed nation. The tariffs would not have become an issue if China hadn't been altering their internal monetary values in a way to disadvantage their trade partners. So while I agree with you in part, the tariffs didn't come from out of nowhere.

 

[AccessBlaster]

Biden could have rolled back the tariffs on day one, but he chose to adopt Trump policy.

 

[jpl458]

Biden should have rolled back the tarrifs. But, Doc, do you think we need he trade war that Trump is proposing? What is wrong woith a world economy?

 

[Steve R.]

@jpl458: You have posted a misleading "straw-man" proposition to spew a veiled anti-Trump diatribe. On the thinnest of surfaces, you are factual that the consumers are the ones that "pay" the tariffs. Nevertheless, you overlooked the very obvious geopolitical reasons for the tariffs which the @The_Doc_Man raised in his response: "However, the goal of a tariff is to redirect buying trends against the tariffed nation."

Back in 2020, in a prior post, (that did not involve the issue of tariffs) I speculated: "Who Owns the Unites States: Russia or China?" Basically (in terms of China), the US has become dependent on the products that China produces. This dependence is not merely simple consumer goods, but products critical to our economy, such as drugs and rare earth metals. China is making aggressive overtures towards Taiwan. Should China "go hot" against Taiwan they may also be expected to cut the US off from products critical to our economy. That is one reason, tariffs need to be imposed to "force" production (manufacturing) back into the US and/or to other countries such as India.

Moreover, in raising this disingenuous tariff issue, you neglect that Biden has implemented economic policies that are making Russia, China, Iran, and now even Venezuela "stronger". Biden is not enforcing sanctions against these countries. Biden is working with the dictators of this world to strengthen their countries economies at the expense of the US economy. The quick example, most "green energy" components come from China. Biden is doing nothing to make the US less dependent on the critical products that we need to get from corrupt dictatorial countries.

 

[Pat Hartman]

Back in 2019, President Biden also agreed, stating, “Trump doesn’t get the basics. He thinks his tariffs are paid for by China. Any beginning econ student at Iowa or Iowa State could tell you the American people are paying his tariffs.”

As usual, the anti-Trump reporting leaves out the important parts of the picture.
1. Doc's point is that the Chinese manipulate their currency to make their exports priced below the cost to manufacture in order to put our US manufacturers out of business as they did with solar panels and batteries. So, should we roll over and play dead or should we rebalance the field with tariffs of our own?
2. Chinese tariffs, in particular, disadvantage our exports. Is that fair trade? Trump is for fair trade, not free trade. He would be on board with no tariffs if every other country removed their tariff's. But, countries like China would also need to refrain from manipulating their currency also since that makes their exports cheap for us but our exports expensive for them.
3. Some things are too important to import. They are a matter of national security. In order to break the back of these "bad for the country" imports like - critical drugs or component drugs and computer chips and ammunition, Trump would impose high tariffs to enable US companies to start up production and compete again. Hopefully, you are stockpiling things like antibiotics or medicines critical to your own personal health because if we end up in a hot war with China or possibly even Russia, life-saving/sustaining drugs will suddenly become hard to come by.

This should be pretty scary. Russia has done an amazing job at depleting our supply of important munitions with their Ukraine invasion. Did they plan this as an aid to China to minimize our ability to defend Taiwan?

The US is heavily reliant on China and Russia for its ammo supply chain. Congress wants to fix that.

The mineral antimony is critical to the defense-industrial supply chain and is needed to produce everything from armor-piercing bullets and explosives to nuclear weapons as well as sundry other military equipment, such as night vision goggles.

www.defensenews.com

I'm also wondering if you have any idea how little France (in particular) and other first world countries pay for drugs patented by "American" pharmaceutical companies?

How Much Does the United States Spend on Prescription Drugs Compared to Other Countries?

The U.S. spends twice as much on prescription drugs as other comparatively wealthy nations, on average.

www.pgpf.org

How Long Do Drug Patents Last | UpCounsel 2024

Drug patents will be valid for approximately 20 years. There are variables that can influence patent life, either to extend it or, sometimes, to shorten it.

www.upcounsel.com

 

[Steve R.]

Some anecdotal economic observation can now be applied to the tariff issue due to "failed" geopolitical policies.
Nixon circa 1972 normalized relations and opened up trade with China. This was under the, now failed, presumption that China would become more free market orientated when exposed to Western free markets. For a while this appears to have worked.

Evidently, the current Chinese President, Xi Jinping, at some point reversed this trend and became evermore autocratic and less fre market. This can be seen by China's take-over of Hong Kong, in 2020 (in violation of the agreement between China and Great Briton).

In terms of the tariff narrative. Trading with a country (China) that can make products cheaper then when made in the US means that we are exporting our wealth to that nation. That was not an issue, under the economic theory, that the country producing the cheap products starts to become richer. Eventually a trade balance is reached were we (the US) is no longer exporting its wealth. I believe that scenario successfully played out with Japan and South Korea. However, with China, that scenario has hit a road-block, evidently caused by Xi Jinping. That brings us back to the point that tariffs need to be imposed on products originating in China to "force" production back to the US. This situation is also exacerbated by the fact the US is now faced with a national security issue as China makes products critical to the US economy and could cripple the US economy if those products are withheld.

 

[Jon]

The Chinese manufacturers have such low labour costs that they have a huge competitive advantage over companies that produce domestically. That is why the vast majority of things like electronics comes from China - its so cheap. Also, a manufacturer sometimes has two production lines: domestic and for export. The domestic production line uses lower cost materials, less quality control and so on, so the prices are significantly cheaper than the higher quality goods for export to the West. The Chinese population are used to the lower quality but more affordable goods.

How do I know this? I used to import goods from China.

 

[Pat Hartman]

The Chinese manufacturers have such low labour costs

Slaves don't get to strike for higher wages or better living conditions. And the Chinese don't care how much they pollute or how dangerous the work is.

We play by the Marquis of Queensbury rules and they don't. Too bad for us.

 

[jpl458]

Please read this. article. It's about tarrifs creating jobs.

https://carnegieendowment.org/chinafinancialmarkets/83746

And this, a republican paper.

How Removing Tariffs Would Create Jobs and Boost the Recovery - How Removing Tariffs Would Create Jobs and Boost the Recovery - United States Joint Economic Committee

It all sounds good in theory, but t doesn't seem to work.

 

[Isaac]

Who Pays the Cost of the Tariffs

Several studies have examined the cost of the Section 301 tariffs on the U.S. economy. For example, economists Mary Amiti, Stephen J. Redding, and David Weinstein showed that by the end of the first year that the tariffs were in place, U.S. real income declined by $1.4 billion per month. More recently, trade analysts Tori Smith and Tom Lee from the American Action Forum found that U.S. consumers largely bore the brunt of the tariffs, paying a total of $48 billion—with half of this figure paid by U.S. firms that rely on intermediate inputs from China. A recent report by the United States International Trade Commission agreed that the cost of the tariffs was passed through to U.S. importers. Back in 2019, President Biden also agreed, stating, “Trump doesn’t get the basics. He thinks his tariffs are paid for by China. Any beginning econ student at Iowa or Iowa State could tell you the American people are paying his tariffs.”

Now he wants a world trade war.

He doesn't care who pays them in the short term. He wants to change the trajectory of the flow

 

[Isaac]

Chinese president ding don't gv

 

[Pat Hartman]

Please read this. article. It's about tarrifs creating jobs.

What do you think Trump did when he ditched Nafta and replaced it with a more equitable treaty? The problem is that you never see anything positive about Trump's policies so you don't ever have the full picture. Trump went to Wharton!!!! I think he understands economics. He also went to a military academy for high school which is why he understands discipline and how the world works. And yes, why he read Machiavelli and Sun Tsu and even Hitler. Why he understands that you keep your friends close but your enemies closer. He also understands why you don't publicly embarrass a "strongman" with a nuclear arsonal like Putin in public. But you can embarrass an idiot by calling him Rocket man. That is probably the only name calling episode I thought was amusing and productive. It got Kim to settle down and stop threatening Japan and Taiwan. It turned out to be a brilliant move - checkmate even though Trump's use of name calling is childish. This one was a winner.

Keep in mind that despite the constant bad press in the US, Trump made the world a safer place. He's the only President in recent memory who didn't start a new war so of course the Military/Industrial Complex hated him also. Let us now remember how Biden was SANCTIONED by the UK Parliament for giving 86 BILLION dollars worth of the best military equipment your money could buy to the bad guys and now those armaments are being used against us and against Israel. How's that for idiocy? Or, did Biden get baksheesh from the Taliban as he has from China, Russia, Ukraine, among others?